Battling COVID-19: World Bank could fast-track $100m loan release

The World Bank is likely to confirm US$100 million loan disbursement for Bangladesh within a couple of days to help the country tackle the deadly coronavirus outbreak, a senior official said.

"We've completed negotiations with the bank on March 31 for the fund it committed. We are hopeful of getting it in a day or two," Economic Relations Division additional secretary Shahabuddin Patwary told the FE.

The Washington-based lender has announced a cool US$160 billion fund for disbursement among its member countries within the next 15 months to aid the countries across the world, now at war on the pandemic that has hit more than 200 nations.

Mr Patwary said at the behest of the Health Ministry, the division requested the bank to provide $100 million in loans for a rapid response project.

Since the South Asia Department of the bank would approve the promised fund, it would not take much time for disbursement, he added.

Another ERD official said they had got a green signal from the WB for spending 40 per cent of the fund from the government exchequer, which would be reimbursed afterwards.

This means the Health Ministry can spend the money from the state fund and then the sum would be reimbursed from the bank's loan after its disbursement, he explained.

Meanwhile, the global lender has approved some $1.90 billion worth loan for some of the countries across all regions as the initial COVID-19 emergency response projects under its Fast-Track Facility.

Out of the $1.90 billion facility, India has received $1.0 billion funds, Pakistan $200 million, Afghanistan $100.4 million, and the Maldives $7.3 million.

The WB board has approved the deployment of $160 billion package over the next 15 months to help countries protect the poor and vulnerable, support businesses, and bolster economic recovery.

The new package is $146 billion higher than the $14 billion fund it announced earlier for the recovery of the COVID-19 virus outbreak across the globe.

Out of the fund, the International Finance Corporation, or IFC, will provide $8 billion to help private companies affected by the pandemic and preserve jobs and the Multilateral Investment Guarantee Agency, or MIGA, $6.0 billion in guarantees for broader financial support.

The WB's concessional lending arm IDA will provide the remaining $146 billion funds to its member countries to weather the coronavirus impact on the economies.

Earlier, the International Monetary Fund had announced a US$50 billion package and the Asian Development Bank $6.5 billion for responding to the impact of the virus outbreak on the economies.

World Bank president David Malpass said, "The World Bank Group is taking broad, fast action to reduce the spread of COVID-19 and we already have health response operations moving forward in over 65 countries,"

"We are working to strengthen developing nations' ability to respond to the COVID-19 pandemic and shorten the time to economic and social recovery."

The poorest and most vulnerable countries will likely be hit the hardest, and our teams around the world remain focused on country-level and regional solutions to address the ongoing crisis, he said.

Responding to widespread supply chain disruptions, the World Bank is also helping countries access critically needed medical equipment by reaching out to suppliers on behalf of the governments.

The bank is also encouraging others to provide financial support to developing countries for the health response, the lender said.